Kerry: Egypt needs political, economic viability

By MATTHEW LEE and AYA BATRAWY, Associated Press

Saturday, March 2, 2013

CAIRO (AP) — Egypt’s bickering government and opposition need to create “a sense of political and economic viability,” giving businesses confidence and setting the stage for a vital international aid deal, U.S. Secretary of State John Kerry said Saturday.

Kerry stressed to business leaders the importance of Egyptians coming together around human rights, freedom and speech and religious tolerance. Equally essential, he said, is uniting “to meet the economic challenge of this particular moment.”

He arrived in Cairo, the latest stop on his first overseas trip as a member of President Barack Obama’s second-term Cabinet, intending to press all sides to come to a basic agreement on Egypt’s direction ahead of parliamentary elections that begin next month.

Of great concern, too, is the ability of Egypt to undertake the reforms necessary to qualify for a $4.8 billion International Monetary Fund loan package. Steps could include increasing tax collections and curbing energy subsidies.

Agreement with the IMF, contingent on ending the political chaos that has ensued since President Mohammed Morsi’s election, would unlock significant U.S. assistance, including portions of Obama’s $1 billion pledge last April.

“It is paramount, essential, urgent,” Kerry told business leaders, “that the Egyptian economy gets stronger, gets back on its feet and it’s very clear that there is a circle of connections in how that can happen.

“To attract capital, to bring money back here, to give business the confidence to move forward, there has to be sense of security, there has to be a sense of political and economic viability.”

Kerry, who was to meet with Morsi on Sunday, said he would tell the president that that U.S. assistance would depend on Egyptian reforms and the IMF agreement.

“It is clear to us that the IMF arrangement needs to be reached and we need to give the market place some confidence,” Kerry said.

Several hundred people protested outside the government offices where Kerry planned to meet with Foreign Minister Amr Kamel. They burned Kerry’s pictures and chanted that Washington was siding with Morsi’s ruling Muslim Brotherhood.

The political turmoil has scared away tourists and foreign investors, eroding Egypt’s foreign reserves by nearly two-thirds of what it was before the uprising. Those reserves, which stand at less than $14 billion, are needed to pay for subsidies that millions of poor Egyptians rely on for survival.

Kerry met with opposition figures before a round-table discussion with members of the business community. He described the first session as “very, very spirited.”

According to the U.S. State Department, Kerry also spoke by telephone with Mohammed ElBaradei, a Nobel laureate who heads the National Salvation Front, an opposition coalition calling for an election boycott.

Kerry met with Amr Moussa, a former minister under ex-President Hosni Mubarak who’s now aligned with the Salvation Front. Moussa, an ex-Arab League head, ran for president last summer.

A statement from Moussa’s office said the two talked about how the U.S. could support Egypt economically.

Kerry’s talks with the league’s current leader, Nabil Elaraby, covered the uprising in Syria, where 70,000 people have died in fighting over nearly two years.

The Salvation Front says it could consider participating in elections if parts of a new constitution are changed, police stop using excessive force against protesters and if an inclusive government of the Christian minority, women, and liberals is formed.

They say now is not the time for elections that will further polarize the country while violent clashes continue to take place between protesters and security forces, further shaking the faltering economy.

They accuse Morsi and the Brotherhood of dominating power in Egypt, effectively stepping in to the same role as Mubarak and failing to carry out reforms while also seeking to instill a more religiously conservative system.

Morsi’s administration and the Brotherhood say their opponents, who have trailed significantly behind Islamists in all elections since the uprising, are running away from the challenge of the ballot box and are trying to overturn democratic gains.

Egypt has been locked in political crisis for months amid successive waves of protests against Morsi that have turned into deadly clashes and rioting.

As Kerry was meeting with opposition figures, including some who have joined the election boycott, activists in the Nile Delta city of Mansoura say a 35-year-old protester was killed when an armored police vehicle crushed him to death during violent anti-Morsi protests before dawn on Saturday.

A 14-year-old boy was reported to be shot in the head and critically wounded.

In the restive Suez Canal city of Port Said, a police vehicle ran over five people Saturday after protesters marching along a main street refused to allow the car through.

Kerry’s visit to Egypt is the sixth leg of a nine-nation trip through Europe and the Middle East.